GmbH Share Capital in Germany 2026: Minimum Requirements, Payment Rules and Permitted Uses
A GmbH requires a minimum share capital of €25,000. Here's everything you need to know about payment timing, permitted uses, and how it compares to the UG.
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- Founding
- Updated
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- Diana
When you form a GmbH in Germany, one of the first questions you'll face is share capital (Stammkapital). The law requires a minimum of €25,000, and at least half of that must be paid in before the company can be registered. But what exactly does that mean? When does the money need to be in the account? What can you spend it on? And how does this compare to the UG, which can technically start with €1? This guide covers everything founders need to know.
Quick Answer: How Much Share Capital Does a GmbH Need in 2026?
A GmbH needs a minimum of €25,000 in share capital. To register, a cash formation in practice often only requires €12,500 to be paid in, provided at least a quarter is paid on every individual share. The legal basis is § 5 and § 7 GmbHG.
What Is Share Capital (Stammkapital)?
Share capital is the capital contributed by the shareholders when the company is formed. It serves as the financial foundation of the company and as a buffer for creditors. In a GmbH, shareholders are generally not personally liable for the company's debts, so the share capital represents the minimum financial commitment the company makes to its creditors.
Two terms are easy to confuse:
- Share capital (Stammkapital) is the total of all contributions, that is, the entire base capital of the GmbH, at least €25,000.
- Individual contribution (Stammeinlage / Geschäftsanteil) is the portion a single shareholder takes on. If three people found a GmbH in equal parts, each holds a contribution of roughly €8,334 in the €25,000 share capital.
Minimum Share Capital: How Much Does a GmbH Need?
German law requires a GmbH to have a minimum share capital of €25,000 (§ 5 para. 1 GmbHG). Each individual share must be a full euro amount (§ 5 para. 2 GmbHG). There is no maximum. Some founders choose to contribute significantly more if their business model requires it or if they want to signal financial strength to clients, suppliers, and banks.
The €25,000 also applies to a one-person GmbH: a sole founder must raise the same minimum capital as a team of shareholders. Since the GmbH reform (MoMiG, 2008), a sole shareholder no longer has to post separate security for the outstanding half, and the same payment rules apply as with several shareholders.
When Must Share Capital Be Paid In?
Share capital must be paid in before the Handelsregister registration is filed. Two conditions must be met at the same time (§ 7 para. 2 GmbHG):
- At least a quarter (25%) of the nominal amount must be paid on each individual share.
- In total, at least half of the share capital, that is €12,500, must actually have arrived in the company bank account.
The managing director confirms to the Handelsregister that the capital has been paid in and is freely available (§ 8 para. 2 GmbHG). The remaining 50% can be called in later, whenever the company needs it.
Worked Example: Two Shareholders
Two founders each hold 50% of a GmbH with €25,000 share capital, so each has a contribution of €12,500. For registration:
- Per share, at least 25% of €12,500 = €3,125 per founder.
- Together that is €6,250, which does not yet meet the second condition.
- Because at least €12,500 must be present in total, each founder pays in €6,250. Both rules are then satisfied and the GmbH can be registered.
Cash or Non-Cash: How the Capital Is Raised
Share capital can be raised in cash or through assets. The two routes have different requirements:
| Criterion | Cash contribution | Non-cash contribution |
|---|---|---|
| What is contributed | Money into the company account | Machinery, vehicles, patents, licenses |
| Evidence | Bank statement / deposit receipt | Formation report (§ 5 para. 4 GmbHG) |
| Valuation | none | value must match the share, reviewed by the register court |
| Simplified protocol possible | yes | no, standard formation only |
| Effort | low | high |
Non-cash contributions (Sacheinlagen), such as machinery, vehicles, patents, or software licenses, are permitted, but must be explicitly described in the articles of association (Gesellschaftsvertrag) and supported by a formation report (Sachgründungsbericht). The register court scrutinizes these carefully, so most founders use a straightforward cash contribution. Under the simplified Musterprotokoll for small GmbHs, non-cash contributions are not allowed at all.
For a cash contribution you first need a business bank account in the name of the GmbH in formation that the contributions flow into. Without proof of payment from that account, the notary will not certify the registration.
How Can Share Capital Be Used?
A common misconception: the share capital does not sit locked in an account forever. Once the company is registered, it can be used for legitimate business purposes, that is rent, salaries, equipment, marketing, and other operating expenses.
The limit is the capital maintenance principle (§ 30 GmbHG): payments to shareholders that would push the company's net assets below the share capital are prohibited. This covers not only open profit distributions but also a hidden return of capital, for example excessive salaries to shareholder-directors, private expenses run through the GmbH, or loans to shareholders on non-market terms. Such payments can be reclaimed from the recipient and trigger capital gains tax back-payments.
In short: using the capital to run the business is allowed and is the whole point. Returning it to shareholders while the share capital is impaired is not.
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GmbH vs. UG: Share Capital Differences
The UG (haftungsbeschränkt) is a variant of the GmbH that can be formed with as little as €1 in share capital. The catch: a UG is legally required to retain 25% of its annual profit as reserves until the share capital reaches €25,000, at which point it can be converted into a GmbH.
| Feature | GmbH | UG (haftungsbeschränkt) |
|---|---|---|
| Minimum share capital | €25,000 | €1 |
| Payment at registration | at least €12,500 (split possible) | fully in cash |
| Non-cash contribution | yes | no |
| Profit reserve | voluntary | 25% of annual profit until €25,000 |
| External perception | established, full GmbH | starter form, top-up planned |
Founders who later want to top up a UG to a GmbH carry out a capital increase, from accumulated reserves or fresh capital.
Share Capital and Bookkeeping: What Founders Need to Track
Share capital appears as an equity line item on the liability side of the GmbH's balance sheet ("subscribed capital"). In your GmbH bookkeeping, any losses reduce equity. If equity drops below half the registered share capital, that is below €12,500, the managing director must immediately convene a shareholders' meeting (§ 49 para. 3 GmbHG). If equity is fully depleted or the company is over-indebted, insolvency proceedings must be initiated.
This is exactly why clean bookkeeping from day one pays off: only by keeping your equity in view can you see in time when you are approaching the €12,500 threshold and need to act.
Frequently Asked Questions About GmbH Share Capital
Does the share capital have to be paid in full?
No. For registration, half (€12,500) is enough, as long as at least a quarter is paid on each individual share. The managing director calls in the remaining 50% when needed. Shareholders still owe the GmbH the full contribution, so the outstanding half remains a liability.
Can I form a GmbH with €12,500?
The share capital stays at €25,000. You can register the GmbH once €12,500 has been paid in. There is no "real" GmbH with only €12,500 of share capital, which is what the UG (haftungsbeschränkt) is designed for.
Can I pay myself a salary from the share capital?
Yes. A reasonable managing-director salary is a business expense and payable out of the share capital. Excessive salaries to shareholder-directors, on the other hand, count as a hidden profit distribution and are problematic for tax purposes.
What happens if the share capital is used up?
Losses first eat into equity. If it drops below half the share capital, a shareholders' meeting must be convened (§ 49 para. 3 GmbHG). If the company is over-indebted or insolvent, there is a duty to file for insolvency. A simple drop in liquidity is not yet a loss of capital; what counts is the equity on the balance sheet.
Does a one-person GmbH also need €25,000?
Yes. The same minimum share capital and the same payment rule apply to a one-person GmbH as to one with several shareholders.
Conclusion: Share Capital Is More Than a Formality
The €25,000 minimum share capital is not an arbitrary hurdle. It is the financial foundation your GmbH is built on and a minimum guarantee to your creditors. Understanding the rules around payment (two conditions), permitted uses (capital maintenance), and equity monitoring helps you avoid liability risks and run a properly capitalized company. Good bookkeeping from day one keeps your equity visible and gives you early warning if action is needed.
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